JUDGMENT
S.L. Peeran, Member (J)
1. This appeal arises from Order-in-Original No. 172/2001-Cau dated 15.10.2001 by which the imported goods namely “Garlic” to the extent of 1078.30 MTs imported by four Bills of Entry dated 16.8.99, 5.8.99 and 2.9.99 are in issue. The only question that is required to be considered in this appeal as to whether the revenue is justified in enhancing the declared value of garlic under four bills of entry from US$ 400 MTs to US$ 565 MTs. The goods have been ordered to be confiscated and released on redemption fine of Rs. 4 lakhs with a penalty of Rs. 2 lakhs.
2. The appellant’s contention is that the department has compared the value of the goods with a single Bill of Entry of 19.7.99 wherein the quantity was only 22 MTs as against the quantity of 1073 MTs imported by them. It is the contention of the appellant that there is no undervaluation nor there is any evidence of remittances over and above the declared price. It is contended that as it is a bulk purchase they have been able to get the same at US$ 400 PMT which is in keeping with the large number of judgments. They have relied on the ratio of the following judgments:
1. Eicher Tractors Ltd. v. CC Mumbai, 2000 (72) ECC 673 (SC): 2000 (122) ELT 321(SC)
2. Mirah Exports Pvt. Ltd. v. CC, 1998 (59) ECC 219 (SC) : 1998 (98) ELT 3 (SC)
3. Basant Industries v. Addl. Collector of Customs, Bombay, 1996 (81) ELT 195 (SC)
4. Spice Trading Corporation v. CC, Madras, 1998 (104) ELT 665 (T)
5. Gupta Exports v. CC, Chennai, 2000 (84) ECC 408 (T) : vide final order No. 906/2002 dated 8.8.2002.
6. Vintel Distributors Pvt. Ltd. v. CC (Sea) Chennai vide Final Order No. 1449/2001 dated 21.8.2001
7. Saudagar Exports & 2 Others vide Final Order No. 698 to 700/2002 dated 11.6.2002.
3. Ld. Advocate Shri A.K. Jayaraj relying on these judgments contended that in terms of the ratio of these judgments, the declared price is required to be accepted and the Bill of Entry produced by the department which imported only 22 MTs cannot be compared with a bulk purchase of 1073 MTs and in the absence of any other evidence if extra remittances made by the appellant importer, the valuation is required to be accepted.
4. Ld. DR Shri C. Mani submitted that the invoice price was not accepted as the declaration pertained to ‘dried garlic’ and, therefore, the rejection of valuation adopted in terms of Bill of Entry dated 19.7.99 wherein there is import from China at
declared US$ 565 per MT has been rightly adopted by the department. He prays for confirmation of the order.
5. We have carefully considered the submissions and have perused the records. It is not in dispute that the appellants have imported in bulk a very huge quantity of 1078.30 MTs as compared to the Bill of Entry dated 19.7.99 by which the import was only to the extent of 22 MTs. The citations referred to before us clearly lay down that the comparable price should be with regard to an import of an contemporaneous import from same country, and of same quantity and quality. In the present case, although the imports are from the same country, namely, China, however the dates are different. The present import has been made after one month from the date of the imports compared by the Revenue. Furthermore, the quantity is not comparable as the bill of entry by which it is compared is for only 22 MTs while in the present case in terms of the statement given by Shri Joshwa Fenn Suresh, Manager of the appellant company that they had placed an order for import of 1500 MTs. The Apex Court in the case of Basant Industries (supra) have laid down that where there is stray instances of import at higher value cannot be effected ignoring other attending circumstances. The Apex Court upheld the lower prices obtained after considerable negotiation and set aside the revenue’s action of increasing the assessable value from US $ 1.80 MT to US $ 2.20 CIF on the basis of contemporaneous import by other importer. This judgment has a direct bearing on the facts of the case.
6. Likewise, the Apex Court in the case of Eicher Tractors Ltd. (supra) also laid down the ratio as to how the transaction value is required to be determined. The Apex Court, among other ratios, also laid down in para 22 the law that a discount is a commercially acceptable measure which may be resorted to by a vendor for a variety or reasons including stock clearance. Therefore, while an importer gets at lower price due to negotiations, in such circumstances, the transaction value cannot be upheld.
7. Likewise, the Apex Court in the case of Mirah Exports Pvt. Ltd. (supra) also upheld the valuation on bulk purchase for negotiated price which granted 50 to 70% discount on list price. The Apex Court also noted that in the absence of any evidence of any special relationship between the exporter and the importer the invoice price is required to be accepted where the importer shows that the price is negotiated.
8. In the case of Spices Trading Corporation (supra) the Hon’ble Apex Court laid down that stray instances of import of higher value is not to be adopted totally ignoring other attending circumstances which also laid down that quantity imported in contemporaneous imports had not been mentioned by the revenue and, therefore, it cannot be given credence to. The Tribunal upheld the importer’s plea on valuation.
9. Likewise, the Tribunal in the case of Gupta Exports (supra) also set aside the higher value adopted by revenue in respect of split grade betel nuts after due consideration of various judgments noted therein.
10. Likewise, in the case of Vintel Distributors Pvt. Ltd. v. CC, Chennai and Saudagar Exports v. CC, Chennai (supra) the Tribunal again upheld the valuation of the importer on the same plea of bulk purchase on substantially reduced price. Both
these rulings have been rendered in light of Apex Court’s judgments noted above. Respectfully following the ratio of all judgments cited, we find merit in the appellant’s contention and allow the appeal, with consequential relief, by setting aside the impugned order.